In light of changing regulations, rising patient deductibles, and restructured payment models, the healthcare industry is currently in a state of continuous flux. The challenges for rural hospitals are complicated even more by a higher percentage of low-income patients and staff shortages.
No business can maintain a healthy revenue cycle or continue on a path of business growth without a sound operational infrastructure. For healthcare organizations, in particular, operational challenges have become increasingly ratcheted up due to convoluted payment models, coding complexities, declining reimbursements, and shrinking profit margins. Since optimizing your revenue cycle must remain a continuous priority, there are some concrete steps you can implement now to maximize your operational efficiency:
According to Forbes, hospitals lose over $45 billion each year as a result of unpaid medical bills. Because of the heavy burden of denial management and a focus on collecting larger claims first, low balance claims often become overlooked. While it’s understandable that large claims tend to take precedence, hospitals should also consider how the successful appeals process for low balance claims can have a positive impact on accounts receivable (AR) management.
Gaps in revenue cycle management present a significant financial risk for all hospitals. Among rural hospitals which tend to have fewer resources, however, the financial risk is even greater. The problem has been further complicated by constantly shifting insurance regulations and skyrocketing patient deductibles.
The California Primary Care Association reveals that insurance billing denial rates range from 5-10%, but some organizations can see a first-time denial rate of up to 20%. To add insult to injury, some organizations re-submit claims only to experience denial rates that can extend as high as 45%.